Illustrating the growing consolidation of the technology industry, Smart Modular Technologies said on Tuesday that it has agreed to be purchased by Silver Lake Partners and its affiliate, Silver Lake Sumeru.

The cash deal is worth $645 million, the New York Times DealBook reports. Smart Modular specializes in the development and design of computer systems; the company was acquired by TPG, Francisco Partners Management and Shah Capital Partners in 2004 for $100 million. Those private equity firms stand to profit mightily from their investment made nearly seven years ago.

Smart Modular went public in February 2006, but will now go private through its new ownership, according to chief executive Iain MacKenzie. "As a private company, we believe we will have greater flexibility to deliver to our customers the benefits of our long term strategies, while managing the volatility of the DRAM cycles that have and will continue to be part of our business model," MacKenzie said in a statement.

Silver Lake's offer represents a 23 percent premium over Smart Modular's average closing stock price over the past 30 trading days, and a 12 percent premium on the stock's close Monday. The deal is expected to close in the third fiscal quarter this year, but Smart Modular has a go-shop period where it can find other potential buyers until June 9.

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